HEALTH CARE Agency considers changes

Retired public employees would help pay for health insurance, it's proposed.
By NORMAN LEIGH
VINDICATOR EDUCATION WRITER
YOUNGSTOWN -- Mounting health-care costs and scores of aging baby boomers leaving the work force are prompting a state agency to consider altering the health-care plan for retired public employees.
Former municipal and county workers throughout the state will be among those affected by proposed changes that would include requiring some retirees to pay a share of health-care insurance premiums, something they don't do now.
"Our goal is to preserve our health-care trust fund so that it can help subsidize benefits in the future," said Laurie Fiori Hacking, executive director of the Ohio Public Employees Retirement System.
Fiori Hacking met Tuesday with The Vindicator to explain the proposed changes, which will be presented to retirees throughout the state.
Presentations will be made July 29 in Youngstown. Retirees must register to attend by calling (800) 222-7377.
Threats to system
Fiori Hacking said the agency is worried about threats to the system's $11 billion health-care trust fund.
The fund is supplied through public employer contributions and through investments.
It's imperiled by higher health-care costs and upswings in the number of public employees retiring younger and living longer, Fiori Hacking said.
The average age of a public employee retiree is about 59.
About 140,000 retirees and beneficiaries receive health-care benefits from the fund. In the next 20 years, that number is expected to build to about 280,000.
About $907 million was spent in 2003 by Ohio PERS to provide retiree health insurance, which costs about $7,500 a year for retirees younger than 65 and about $3,300 annually for retirees older than 65.
Changes
To preserve the health-care fund, the retirement system is proposing several changes, largely aimed at public employees who will be retiring after 2007 and future public employment hires.
Those retiring after 2007 with 10 to 15 years of service will have to pay 100 percent of the annual health-care insurance cost. Post-2007 retirees with 15 years of service will pay half the annual cost. Those who retire with 30 years of service won't have to pay to be covered.
Also proposed is having public employees hired after January 2003 pay 75 percent of health-care insurance costs after they retire, providing they retire with at least 15 years of service.
Future hires who retire with 30 years of service won't have to help pay.
Other changes being weighed include increasing the contributions public employers must make for each employee.
Right now, they must contribute an amount equal to about 13.6 percent of their employees' pay, which goes toward pensions and retirement health insurance. The contribution would increase to 14 percent under the new proposal.